In an interview with the newspaper, Mitsubishi Heavy President Hideaki Omiya said his company had "various talks" with Hitachi, confirming it had been considering integration of some of its operations including social infrastructure systems.

But he flatly denied the possibility of an all-out merger of the two, saying his company had no plan to set up a merger preparation committee, as was reported by some media.

"We should not try to do everything by ourselves when we venture into overseas markets as the domestic market shrinks," he was quoted as saying.

"If merit can be found for both sides, we would like to tie up with not only Hitachi but with foreign companies," he told the paper.

Copyright Reuters, 2010